IETA CEO inaugurates course on energy and emissions trading

Andrei Marcu, CEO of the International Emissions Trading Association, was special guest at the launch of the Institute's new course on energy and emissions trading (Tuesday January 29th).


Marcu spoke about using markets to deal with environmental scarcity. Markets offer flexibility, encourage innovation and create the possibility to monetize the transition to a low emissions economy.

According to Marcu, Finance has been late to the table in the development of emissions trading. In the past, the main drivers behind emission trading have been the companies involved in manufacturing and energy.

Likewise, traditional names in finance and executive education do not yet offer specialized training in emissions trading. Marcu congratulated the Institute for taking the initiative with the new emissions trading course, which will assemble energy and trading experts Mark Holder, James Kharouf and Peter Fusaro.

More than 50 people attended the inauguration event at the Swiss Finance Institute's new offices in 9 Rue de Gare.

Notable attendees included Michel Chevallier, Geneva State Head of Cabinet, senior representatives from Swiss and international banks, journalists from Le Temps and L'AGEFI, several Swiss Finance Institute professors and even a few hedge fund managers.

Our new Geneva office is accessible by low carbon public transport courtesy of Geneva main station, which is situated directly across the road.

So do drop in if you are in town!

(and for those further afield, visit our Gallery)

We will issue a press release about the event on February 6th.

Emissions trading update

This week, the CEO of IETA, Andrei Marcu, will talk about emissions trading and sustainable development at our new offices in Geneva.

The IETA issued a press release yesterday calling for better recognition of environmental standards in the voluntary carbon market place.

I will be speaking with Mr Marcu about his experiences at the World Economic Forum last week, including the session on The Effectiveness of Carbon Trading.

The World Business Council for Sustainable Development (WBCSD) has quoted Mr Marco in a news release on January 25th:

“A clear outcome from negotiations in Copenhagen is essential for the continuity of the rapidly growing carbon market. There are substantial investments flowing through the Clean Development Mechanism (CDM), but uncertainty about the future of the market after 2012 could easily undo the momentum and hinder future expansion,” said Andrei Marcu, President and CEO of the International Emissions Trading Association (IETA).

Over the weekend, Japan Prime Minister Yasuo Fukuda unveiled a 10 billion dollar climate change fund. The proposal included the Cool Earth Promotion Programme, which features a new financial mechanism to reduce greenhouse emissions.

The plot below displays recent blogging activity about emissions trading:

Interview with Jean-Pierre Danthine in L'AGEFI

L'AGEFI 2008 01 15 Interview with Jean-Piere Danthine by Sylvain Frochaux discussing the "paying for luck puzzle" in corporate finance.

Professor Danthine anticipates an increase in shareholder activism.

Danthine points out that the five largest investment banks on Wall Street will distribute a record $39 billion in bonuses in 2007, despite the fact that three have published the worst fourth quarter results in their history. Shareholders have lost more than 80 billion in value.

He identifies problems in corporate governance and refers to Michael Jensen's work in the 1980s concerning agency costs and ownership structure.

Links: Founding vision of Davos, Gold Standard carbon offsets and more

FT Interview: Klaus Schwab
Haig Simonian describes Geneva business professor Klaus Schwab's founding vision for the Davos meeting 37 years ago as a interdisciplinary platform for executives to mingle with others.

Britain and US up in arms against EU carbon tax
"Could require exporters to buy EU pollution permits if they wish to trade within the bloc"

Credit Suisse, AIL and South Pole to launch carbon investment vehicle
Offset trading program in which the underlying assets are Kyoto Protocol carbon credits generated by carbon neutral projects. The majority of the fund will be invested in Gold Standard certified projects.

New Middle East environmental advisory services company launches regional carbon offset and management initiatives
Foundation of EcoVentures reflects the awareness of the importance of environmental concerns in the Middle East.

Links 2008 01 21 Promotion of SFI Alumni Peter Senn, Climate change for business, Katinka Gyomlay on sustainable investments

Handelszeitung Online 17-01-2008 Alumni Peter Senn
Handelszeitung Online 17-01-2008 Alumni Peter Senn promoted to Management team at Bank Julius Bär

Climatechangecorp: Bali special report – was it good for business?
IETA is mentioned in conjunction with the UN climate conference in Bali, Indonesia. The blog mentions that the IETA was represented at the conference and that the message from Industry was that the cost of energy innovation was high, the market price for carbon too unstable and that consumers were very sensitive to increases in energy cost.

Private magazine: Mit Zertifikaten nachhaltig investieren
Finance journalist Katinka Gyomlay describes how sustainable investments are moving into the mainstream with 25 billion CHF in the Swiss market alone and news that investment volumes have doubled in the past year.

Links 2008 01 18 Economist on sovereign wealth, Affordable Ivy league education and Haig Simonian on future of traditional offshore private banking

The Economist: Asset-backed insecurity
Editorial on sovereign wealth fund investments on Wall Street highlighting innate fears of financial protectionism and the potential political backlash this could bring in Washington.

The Economist: Affording Ivy
Ivy league universities in the US have financial-assistance policies for students, with Yale, for example, expanding its financial-assistance budget to over $80m.

The Economist: Do it right
Economist ran a special report on corporate social responsibility this week. This piece looks at the the role of enlightened self interest, with resonance to SFI Professor Wagner's work on executive compensation risk.

FT: Demand for growth comes with tightening rein
Haig Simonian looks at the future of traditional "offshore" private banking as the US and Europe seek to limit the activities bankers working internationally.

New SFI Newsletter released!

The 2008 January edition of the Swiss Finance Institute Newsletter is here!

My news story covers the 2007 research prize winner, the December 4th Annual meeting, new courses, and news about the launch of the Executive Courses in Finance Emissions Trading course.

Links 2008 01 16 McKinsey on planning, fine tasting cheap wine, Prediction markets woes

Being strategic about strategic planning - McKinsey on Finance Podcasts
How to improve strategic planning (Renée Dye and Olivier Sibony) - January

Results from a survey of 800 managers reveals "frustration" with their efforts in strategic planning. Dye and Sibony emphasize the importance of covering the issues and asking open questions before setting forth to gather data and forecast. The Podcast also recommends that managers should participate more actively in strategy review and defines ways in which this can be done in a time-efficient manner.

BBC online about wine
Researchers at the California Institute of Technology have shown that a person's enjoyment of wine can be heightened if they are simply told that it is expensive.

The market gets it wrong about US presidential candidates

Online prediction markets enable individuals to bet on the outcome of dozens of events.

"The best known of the online prediction markets, Intrade, gave Obama a 70.7 percent chance of winning in the Granite State and Clinton a 27 percent chance."

Who's afraid of Sovereign Wealth?

Swiss biz news journal Bilanz interviews Government of Singapore Investment (GSI) Director Ng Kok Song about sovereign wealth investments in UBS.

A second piece appears in the same edition of Bilanz entitled "Swiss Banking Under Palms". Mr Ng is an Advisory Board Member of Singapore Management University and the article describes the association between the Swiss Finance Institute and the SMU's Wealth Management Program.

Le Temps reports on Swiss Finance Institute research award

Jean-Pascal Baechler (Le Temps) reports on the winners of the SFI 2007 Outstanding Paper Award.

McGill University researchers Susan Christoffersen and Sergei Sarkissian received the award for their publication showing that big city mutual fund managers outperform their peers in smaller financial centers. Sergei Sarkissian gave a full presented on the paper at a special event at the Société de Lecture, Geneva on December 6th.

Download a pdf of Baechler's article (French).

Links 2008 01 08

UBS investor upsets shareholders
Brief interview with Haig Simonian (Financial Times) about the reactions of shareholders to UBS' financial arrangements with a Saudi investor.

"Involuntary asset growth" and the beginnings of the "true" credit crunch in 2008
Sam Jones posting on FT.com about the addition of €450bn in illiquid assets to the balance sheets of European Banks.

SFI PhD graduate: Jijun Niu

Jijun Niu, a recent graduate of SFI and the University of Lausanne, started his new career as an Assistant Professor of Finance at Simon Fraser University in September.

Jijun Niu worked as an engineer in China before resuming studies for an MBA. This sparked an interest in research and teaching, ultimately leading him to a SFI Ph.D. in finance from the University of Lausanne, Switzerland.

During his first semester at Simon Fraser University, Jijun taught courses in Finance Institutions. He told Swiss Finance Institute views "I have learned a great deal from my dissertation advisor, Prof. Erwan Morellec, about doing well both in research and in teaching."

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The Swiss Finance Institute is a private foundation created in 2006 by Switzerland's banking and finance community in cooperation with leading Swiss universities. It supports and advances research, doctoral training and executive education in banking and finance. The Institute is supported by the Swiss banks, the Swiss Stock Exchange, Swiss universities and the Swiss Federal Government.